You're listening to Strictly Business Podcast with Lindsay Williams.
It's Thursday, so it's time for the 5 o'clock shadow with Viv Govender and David
Shapiro,
except it's not the 5 o'clock shadow because it's not 5 o'clock yet and David
Shapiro has cried off with some excuse.
So Viv and I are going to tackle the world together, but who needs more than Viv
Govender, especially Viv,
when software companies have been under the spotlight so vigorously this week,
haven't they?
What on earth has happened?
Well, I mean, I think...
what's been happening is people are looking at what the future holds for AI,
etc.,
and are thinking that maybe we are seeing a situation in which some of these
companies'
future growth is not going to be what people think.
I think, quite frankly, it may be over-predicting basically the impact of AI
at the moment.
But if you forecast into the future, I do think that it's reasonable to assume
that in a couple of years' time, we are likely to see some impact of AI on these
companies'
revenue, etc.
I saw an example.
It was something to do with a legal software package,
which analysed cases and illegal law over time periods.
And they said that AI has completely replaced that.
So this company was selling this software package, not out of business, but
certainly having its business impacted.
Is that something that's likely to be across the board?
Yeah, I mean, for instance, I don't know why someone would use something like one
of those language training programs, you know,
when you could do it with the AI systems at the moment.
And I think it gives you a better tutoring kind of result.
I mean, some of the educational stuff I've already, I mean, I've like, you know, used
Gemini and even
ChatGPT recently to learn about new topics.
You can go in depth in ways that you'd be You're pressed to find any kind of other
system letting you get there.
I mean, if you do physics, you can talk about quarks or Gemini at a level that
you'd have to find a university professor to help you out with.
But I mean, language stuff, you know, any kind of thing to do with, like you said,
with the legal system, etc.
These LLMs have gotten to a point right now where they are real competition for
these programs.
Talking about Gemini, and you've mentioned Gemini almost every time we speak, Viv.
use Gemini, I use Copilot, I use Grok quite a lot.
I also like DeepSeek.
I don't know if you ever used DeepSeek, but did you see that article that I sent
you from the Guardian newspaper in the UK,
which looked at the personalities and the traits of each of the AI apps?
It's very interesting to say one does this, one does that, one does the other.
Did you agree with what you read, if you read it?
I did, but I also think that, okay, look, I'm sure you've seen the French case
against Grok.
Yes.
With regards to making lewd images, et cetera.
You know, irrespective of the morality of it, I think there is a desire for this
kind of stuff,
or this stuff that goes against the terms and conditions of the providers out there.
And I think what's going to happen in the future is that people are not going to be
satisfied with accepting Grok's personality or Gemini's personality, et
cetera,
which is quite similar to what you talked about in the article.
And what you're seeing with things like these malt pot.
which we discussed, I think, a while back when it was called Cloudbot two weeks ago.
And with Maltbot, what you'd like to find is people are going to basically have a
personalized
kind of thing that does what they want in the way they want it to be done.
And if you can't find, for instance, like you said, a grok or an alphabet, et
cetera,
you'll use a deep secret, a Kimi, which is the new one from China,
running your own server to do the things you want it to do in the ways you want it
to do it.
uh because uh if you asked grok or you asked uh you know chat gpt or whatever
they would quite likely refuse
you or maybe even call the authorities depending on what you're asking you to do
you know what i mean um and it need not be something as as extreme as what
grok's been accused of right now i mean uh there are For instance, certain
restrictions on, you know,
Holocaust denial, for instance, in France, that would obviously run afoul of the law
there.
But you could basically get a local system to do whatever you want with regards to
that.
So, yeah, I think that the future is not going to be you accepting Grok or you
accepting Gemini's personality.
It's you crafting a personality on your own local device, which may use Grok
underlying it, or may use an open source system underlying it.
I asked one of the apps, I said, can you please analyse the breakdown,
can you give me a breakdown of the staff at Mar-a-Lago, how many, what their race
is, what their gender is, etc.
And it said, no, I'm sorry, we can't do that.
And the reason I did it, of course, is because of Trump's recent pronouncements
in the last few hours
saying that a certain company has too many of this type of person and not enough of
another type of person,
which is blatant.
stupid in my opinion but that's just me but this particular uh act wouldn't um
wouldn't
analyze it for me because of obviously the trump factor and also another thing i
asked a simple question is
there a market for this type of book covering this type of subject which
because i was thinking of embarking on writing
one and i got so many different answers from so many different sources one says
yes fantastic idea this is how you do it the other one said no
Yeah.
No, nobody's going to read that.
Very interesting, Viv.
They've developed their own personalities.
Yeah, most certainly.
And look, also, they've learned what, remember, the way this works is that you
get this thing trained to get this kind of lump of
intelligence, and then that's kind of fine-tuned with human interaction.
And over time, it learns what humans want it to say.
So some things, like the earlier version of ChatGPT, were super kind of flattering,
super kind of, you know,
CQS, green with everything you said, so you say the world is flat as it, by God.
You're such a genius to figure this out.
The world needs to know more about your genius, et cetera, et cetera.
And obviously the dangers that come from that.
And I think that they still,
that obviously the pleasing aspect that these things want to make sure they make
you happy because that's what they've been trained on, not to be correct,
but to make the person inputting questions happy or prompts happy.
And so there is that danger.
It does not give you the right answer when you do ask it for things.
But like I said, I mean, I see the future and let me tell you not I mean not this
year or next year but in a few years time
I don't see why or how it's not a case where everybody has their own kind of um
bolt port or whatever the version
that is in the future an agent running that uses an underlying I know AI using
multiple AIs underlying it but that
bolt port is kind of tuned to what your level of sarcasm what your level of
interest the
way these things work is they need to have this huge context windows which has all
the information it has about you uh to basically give you the right kind of on
some.
And I think that is something I think probably these different things don't
have,
because maybe Gemini has information about you in certain aspects that maybe ChatGPT
doesn't.
And that's why it's giving you different answers as to what it thinks will make you
happy.
Well, don't forget, of course, there was the very famous and very disturbing case
of a South Korean woman
who married her ChatGPT assistant.
There was a ceremony.
She wore a dress and everything else.
And she was perfectly serious about this.
she found that a human couldn't...
be as nice and, as you said earlier on,
obsequious as a chat GPT man or assistant did, whatever you call them.
Very interesting.
We have to get away from that.
No, we don't get away from tech because the amount of volatility in this tech
stocks rivals that of precious metals recently.
I mean, I saw AMD doing one thing.
I saw PayPal doing another the other day.
And it's not uncommon to see, you know, 10, 15, 20 percent moves.
in a day.
I mean, that's pretty uncommon, I would say.
Yeah, it is uncommon.
But it's, again, a function of just, like you said, AMD, right, down, you know, 10
plus percent.
But if you look at the one year performance of this thing, it's up still
78%.
When you've done it before this, almost a 90% run in a year,
the market basically needs to have some pretty strong numbers to justify keeping
that up.
And if you disappoint even slightly, a 10% pullback in a day is not impossible.
I mean, another example I would put is Palantir.
I mean, Yes, this share price is down dramatically in the last month or so, down
20%.
But if you give it a five-year chart on this thing, this thing is up three times
plus in the last five years.
Again, when you build in these kind of expectations, that's when you have the
pullbacks.
That's why we saw the same kind of thing happening with silver and gold.
Yes, they came back dramatically, but the silver price fell after running up to
about $120 an ounce.
The gold price fell after going up to $5,500 an ounce.
Silver was below $40 last year.
gold was below 3,000 last year.
When you do these kind of moves, these volatile pullbacks are what you'd expect
irrespective of the underlying asset class.
What do you make of precious metals as we get away from tech now?
Because this time last week, when you, myself and David Shapiro were talking,
the gold price actually went to a high $5,625 and that's within 24 hours, Viv.
It was down below 4,500 briefly.
It's bounced back to above 5,000, now below there again.
It's all over the place.
Silver did the same thing.
And many people saying that the volatility in the speculative silver market led gold
up and down and pulled it around a bit.
But as you quite rightly say, when things do so well, of course, there's going to be
corrections.
But it does tell you that there is a big speculative bubble right at the top of the
performance of the
graphs of both AI stocks and precious metal stocks.
Yeah.
The only question is, are these things real?
and the the the one thing I would say is look at what Google is doing at the moment
with their CapEx.
The market expected $119 billion of capex from Google.
They're getting somewhere like 50% more than that, which is an insane number.
The market basically obviously ran up on gold and silver, but why is it doing that?
And I think the reason is fundamentally strong.
I mean, there's two reasons to buy gold right at the moment.
One is obviously the gold is a safe haven.
The other is gold has demand for jewelry and other things.
I think the safe haven reserve demand for gold is getting a stronger and stronger
case going forward.
Because of the fact that people are turning away from the US dollar, right now
the US dollar is more than half of global reserves.
No country I know should be happy with that.
Even strong allies like Denmark, if you call it an ally anymore, or the EU, or
Canada,
but certainly not places like India or China.
In those countries, I mean, you want to replace gold, the US dollar with something
else, what are your choices?
Is it the euro?
That's almost the same as the US dollar because of the strong links those
countries have.
Gold and silver become the only things you can do.
And unfortunately, there's not that much of that in the world.
I mean, if you had to basically replace the US dollar entirely with gold and
world's reserves,
the gold price would be closer to 100,000 than to 5,000.
You know what I mean?
And the same thing applies to silver.
So I think that's what's happening right now is that there is a fundamental shift.
The future is more gold in the world's reserves than currently is there at the
expense usually of the US dollar.
That's going to result in a higher gold price.
Whatever move happens in one day or happens over multiple years, I think is
what the question is at the moment.
The big question was over the last couple of years is will Bitcoin replace all these
other instruments that you've
just mentioned?
Bitcoin plus other cryptocurrencies.
There's a proliferation.
I've got this website that I look at and it says cryptocurrencies.
You click on it and it just keeps on going and going and going.
These coins that you've never even heard of.
Let's have a look at Bitcoin.
Just creeping back up over 70,000 as we speak.
It was 126,000 in October.
And all the talk of Trump making the United States the crypto capital of the
world drove it up
a lot, I have to say, all that rhetoric.
And Eric and Don Jr.
going to Dubai and sitting on stages and sweating away and talking crypto up.
It's all fizzled out.
It's 45% lower.
Is this the end of it or is this just like silver or gold or certain?
tech stocks, it has to come down after such a run.
Look, I mean, crypto is famous for these pullbacks.
I mean, we saw, for instance, back in 2022 or something, it was down below 20,000,
you know what I mean?
And this was from being above 60,000 in 2021.
And if you look at that kind of move, it's basically lost two thirds of the value.
So if you look at going to 120, to do a similar kind of move there, you'd have to
go below 40,000.
to do a move of more than, say, two-thirds.
Right now, I think my number is about 69,900 or so at the moment.
Yes, exactly.
And so I think, quite frankly, this is something to be expected with these
currencies.
I think they are, unfortunately at the moment, an entirely speculative asset
class.
There's no real use case for even Bitcoin, which is the most stable or the most
established of these cryptocurrencies.
If you're doing any transaction with crypto that you wouldn't want to do with
the banking sector, my question is why are you doing that?
And generally, it's because you're trying to evade some kind of laws or regulations.
If you look at crypto's usefulness at the moment,
the primary usefulness for transactions is either something that's semi or totally
illegal, quite frankly.
And that's sort of a great foundation going forward.
And other than that, the main use is speculative.
Basically, people buy it for the value to go up.
It's not like it's like basically you don't have dollars in your account because
you want the dollar value to go up.
You have dollars in your account because you want to have, you know, some stable
currency that you need to spend elsewhere.
Until crypto becomes something like that there, unfortunately, these fluctuations
are just something to be expected.
Quickly, we must look at the U.S.
jobs data which came out today.
The ADP numbers showing a soggy, a soggy jobs market.
Real jobs numbers, the non-farm payrolls, which we expect on the first Friday of
every month,
have been cancelled again because of shutdown problems in the United States of
America.
But also, I would imagine that the Bureau of Labor Statistics, its new people there,
are massaging the numbers on behalf of the president.
That's what a cynic would say.
But anyway, U.S.
jobs numbers, not particularly good.
Before we go, Viv, any tech stories that we haven't covered, I introduced with the
software woes.
What have you seen in the last week since we spoke?
Anything interesting?
Well, speaking of those jobs numbers, I mean, I think half of the jobs cuts
announced in January by like three companies was Dow, Inc.,
UPS, and Amazon, which was basically the major things there.
I mean, I think UPS was 30,000 jobs.
Amazon was like 16,000 jobs.
So I do think that's obviously and Dow, I think, was just under 5,000 jobs, so it
wasn't as much.
So these kind of things, I think, are quite...
concentrated.
There's questions as to whether or not this is AI related.
I think with the Amazon one, there's a question not just whether it's AI
replacing jobs or whether or not they need to cut the jobs to get free up enough
money to invest in AI.
And the other thing I think that we need to discuss, of course, or that's important
to have noted, is those alphabet numbers.
The CapEx spending in alphabet is just, I think, enormous by any means,
approaching $200 billion over the next year.
Countries don't do this, you know what I mean?
This is not something even that China and than the US does on individual.
Infrastructure prices, we're talking about building power systems or power grids or
building highway systems.
They don't build this kind of money.
A private company is doing this.
And the question I would say is this, if the guys with the most information and
consider to be the smartest guy in the group,
in the world basically, are accelerating the amount that they're spending on this
technology, what does it mean?
It's more likely not to mean that they are seeing things behind the scenes that we
just don't see at the moment,
probably showing that there's no wall, there's no plateau.
And we are likely to see a very interesting next couple of years as the
technology that they see right now.
they give to us in a six months to a year's time or is it the fear of missing
out because other companies are doing it they've got to do it and they've got to be
seen to be
the ones that are spending the most on capex is it is that a factor but
potentially because at some stage people are going to say okay how
much how much more sophisticated can artificial intelligence become without
creating
something that is better than the human brain which arguably they've already done
yeah look i mean the thing with that
i think it's interesting i don't know if i mention this to you or not but The
multi-bot technology or the cloud-bot technology,
it's the first time that you're seeing this wide-spect technology use that's
actually making people use up their tokens and buy more tokens or
upgrade their plans.
I mean, if you just used AI and just asked a few questions, often you can get away
with just using the free systems.
And we can just go and basically use even the AI available on the Google search bar,
you know what I mean?
The AI mode there.
But when you use these agents, when you use these things like Mallport, etc.,
suddenly you find yourself using $100 of tokens in a day or maybe even more.
And that scenario here, I think that is the killer app that gets you to the point
in which people are using
a lot more of this technology than they were in the past and spending more on it,
more importantly, than they were in the past.
And I think that if you were just trying to keep up with the Joneses, you might be
willing to spend what was expected, $120 billion,
maybe $130 billion, but not.
190 billion?
Why are you spending 50% more than the market expects?
That's just not keeping up.
And the next thing to note is that Google, on a different basis,
is actually becoming a real player in the hardware space.
Anthropic, as well as Apple, are likely to be using Google chips to help build their
systems.
And that means that if you look at the biggest hardware producer out there, which
is obviously NVIDIA, or producer,
but the player in the hardware space is NVIDIA, they don't actually produce, they
just design.
Does the company work more than Google?
And I think that's also maybe indicating that maybe Google is seeing or Alford is
seeing an opportunity here to encroach on a space that
it's only been a bit player at the moment.
It never stops, does it?
There'll be something new next week.
And next week, we will speak to you with David Shapiro.
Viv, thank you very much for your time.
That was Viv Govender from the award-winning RAN Swiss.
And that was not the 5 o'clock shadow.
The views and opinions expressed in these podcasts are those of Lindsay Williams and
various contributors.
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